Giving house to step-daughter?

I wouldn't speak to the husband as the financially literate person as he's the recipient. They have great income, and since you've mentioned your paying all childcare costs I'd be wary of doing too much.

There was no edit - I was in the middle of typing when the screen refreshed so I just carried on. It's really hard to type on mobile without the app.

Anyway the OP has updated so this is irrelevant - but as PP and I pointed out the original figures didn't make sense.

Same here OP!
And it looks like you've got time, what they currently have is big enough. You can aim to sell your house, give them the money and the can move on by the time the child is 3-4 years old, at which point they'll have saved up more too.

I think that's a very kind thing to do. It won't just be fantastic for her to have the money but it will say so much to her that you want to do this.

I’m glad that the thread has given you some clarity @IsMadl

My dad is step dad to my sister and has been her only father since she was 6.
In every single way he is her dad and he has treated her as his daughter
He gave all of us the same amount when looking to buy a house to him it didn't matter than she isn't blood she is his daughter. It sounds like your step daughter is the same.

To me the question isn't whether your step daughters or niece and nephew inherits the property. The question is when do you pass on the property to your step daughter and how much of the property to pass on now and how much to put to one side and leave in a will to leave her later. It probably is worth sitting down with a financial advisor, go through your financial situation with a fine tooth comb. Pressure test everything and work out what to gift now and what to save in a rainy day fund.

The problem is (at least for me in this scenario) even with OP helping, they likely still wouldn't be able to cope with mortgage costs. Imagine if mortgage rates went up to close to 7% again, they'd be buggered - they're already trying to max it out if possible. They want to max out on 5x salary - but they likely haven't considered things like council tax going up (definitely going to happen), childcare costs going up etc and are likely banking on promotions or pay rises which is risky/borderline bonkers.

OP should be trying to encourage them to be responsible (and thereby pointing them towards a property they can actually afford), not potentially leading them down a very miserable path. They can't afford a forever home. If they could I would think differently.

I think that’s a lovely idea OP and ultimately what you do with your property is your choice. As others have said, you could state in your will a % to go to your niece and nephew too.

When we first started house hunting, we shared all sorts of properties with family, some that we could afford, some that were a stretch, some that were pipe dreams. Not out of any expectation or hinting for help. Just part of conversation. We don't know if the SD has also shared 'for now' properties. They may well still be trying to weigh up all their choices, keep saving for a bigger deposit vs moving to a smaller place, and are asking family opinion.

Nice edit there. 🙄

My parents are in the SE. Not up north. My point was about how things have changed generally for the younger generations. If parents are in a position to offer to make life easier, why shouldn't they?

Have they said how long they think they'll take to save enough deposit?

They must have a sizeable amount already if they're planning on an £800k mortgage and looking at £1m + properties. I think stamp duty on £1m will be £41k

Would your help just be to reduce the mortgage?

Not that that isn't lovely of you, but is sounds like they can get the property they want on their own anyway.

It might make more financial sense as PP have suggested to give her the monthly rent and then leave it to her in your will.

I did wonder what the point of posting all those houses in the chat was though.
It looks like even with OP's contribution they'd be cutting it close. What were they planning to do otherwise?

The issue here IMO isn't just the affordability on paper it's potential future scenarios regarding continued employment and disposable income.

What your parents could afford is irrelevant in 2024 even 'up north' or in cheap areas most people don't do that.

Many people max out affordability when the children are older. Not only does affordability improvise somewhat with childcare out of the way, parents are also more advanced in their careers and earning more. It's very hard to say which way it'll go when the kids are young. Many find juggling young children and a demanding job too much, so cut their hours. Which is hard to do with a massive mortgage.

Do they want the big house so badly that they're willing to make a lot of other sacrifices?

I think this is your house, your money and your relationships so YOU have the say as to what you do with it. Are you close to your niece and nephew? I would imagine that over the past 20 years you have probably had far more to do with SD growing up than you have with them - you are her second mum and obviously have a lovely relationship. I'd sell the house and give them the money if you are sure you are comfortable for your older age.

It seems implausible that anyone looking to buy in London would be searching in these two areas which are more than 12 miles apart - a 2.5 hr hike in rush hour!

Perhaps they like both areas and need to get into central London - I don’t think that’s particularly implausible

That would be really massively stretching themselves and I wouldn't recommend that, that would probably be their absolute maximum borrowing amount. They need to look for a cheaper house.

It seems implausible that anyone looking to buy in London would be searching in these two areas which are more than 12 miles apart - a 2.5 hr hike in rush hour!

Not the point of the thread, but hey, I dislike discrepancies.

To the OP, you can help your daughter and still leave your niece and nephew the same bequest when you die by leaving them a share of your marital home instead, and explain to your daughter you are giving her an inheritance earlier.

Win win.

Ordinarily, I would agree. But, if there is money available to allow them to move once into a 'forever' home, the tens of thousands saved in taxes and moving costs, and OP is willing to offer that money, it isn't unreasonable. It doesn't sound like the SD is asking OP to sell up and give her the money - that would be entitled - more than OP wants to help and see her SD live comfortably. Sure, it is unusual for families in their 20s these days, but I look back at what my parents could afford on a single salary and it is not dissimilar to what OP is posting here. There never used to be any need for starter homes. They rented flats for a couple of years after marriage and then moved to a 4 bed detached house with garden.

I would be worried about the possibility of something unexpected happening to them, such as job loss, with such a massive financial investment.

Apologies I missed your later updates by not refreshing the thread. Fully understand your views, she is a lucky girl.

Two things, your parents will in all likelihood disinherit you as they will see it as offsetting what your niece and nephew did not get. People do odd things.

I know the Greenwich area well and that's a lovely house in catchment for an extremely hard to get into primary school with a lovely park next door. Their catchment was about 50m radius at one point.

What I would say is that unless the deposit is humongous they are not going to be able to meet their mortgage AND CHILDCARE costs with one or even two small children on their combined salaries. Nursery in that part of London will be in the region of £100 per day and it's not practical to have children under your feet just because you work from home.
Stamp duty alone on a house of that price will cost them a substantial whack on your gift.

So given she is pregnant, I would suggest the simplest thing is to ask if they have worked through all their costs to the last penny and figured out how much disposable income they will have. It's very easy to forget just how much more expensive the council tax will be on a home of that size for example.

It may be much easier to buy something at a lower value and improve in years to come when they have more disposable cash. This is on the same street but without the loft conversion so still 3 beds. It's priced for the school catchment though.
https://www.rightmove.co.uk/properties/148919366#/?channel=RES_BUY

Lastly, it is incomprehensible for people outside of London to live with no outdoor space, or very little at all. But in London it's the norm and there are great parks both large and small almost everywhere. With two working and young parents, they will be out spending time in parks and playgrounds for most of their weekends.

Unless the SD's husband has some other income we don't know about. Investments? Maybe planning a career move that will take him to 300K earnings?

OP if you are to help you should know the full picture before you commit to anything.

Those mortgage repayments are unaffordable if your assessment of their income is correct. I earn more than them combined (based on your estimates) and I wouldn’t commit to paying that. They will have very little margin for error.